- To “employ” is to “to suffer or permit to work.”
- An “employee” is “any individual employed by an employer.”
- An “employer” is “any person acting directly or indirectly in the interest of an employer in relation to an employee.”
- Who has the right to control the work? If the employer can tell the worker how, when and where to perform the work, the worker is likely an employee. The employer’s level of supervision or requirement that the worker report to a supervisor is also considered.
- Is the work an integral part of business operations? If the worker’s services form an integral part of the employer’s business, the worker is likely an employee.
- Did the worker make an investment in his business? If the worker has invested in his own equipment, supplies, facilities, or training, he is more likely an independent contractor. Generally, courts will compare the worker’s investment with the employer’s investment.
- Is there an opportunity for profit or loss? Is the worker’s opportunity for profit or loss determined by the employer, or the worker’s own managerial skill? For example, if the worker can make a profit by being more efficient or hiring helpers, he is likely an independent contractor. On the other hand, if the worker can increase earnings only by working more, he is likely an employee.
- Does the work require specialized skill? This factor is often dependent on the industry and the employer’s business. Highly skilled workers can be employees, depending on the nature of the work or the industry.
